Nemaska Lithium Secures $600 Million Equity Investment Proposal

Nemaska Lithium (TSX: NMX) announced this morning that it had finally made progress on securing funding for its lithium hydroxide project in Quebec. It was announced back in February that the firm was running out of money quick, and would need at least $375 million to continue with the project.

The source of potential funding comes from The Pallinghurst Group, and consists of C$200 million in the form of a private placement, and an additional C$400 million through a rights offering. While currently earmarked as a letter of intent, Nemaska Lithium and Pallinghurst have entered a three month exclusivity period to allow a definitive agreement to be formed. It is expected that this will be the final financing required to allow Nemaska to complete its Whabouchi project in Shawinigan, Quebec.

Both the private placement and the rights offering are to be conducted at a price point of $0.25 per share.

Guy Bourassa, President and CEO of Nemaska Lithium

“I am very proud today to share with all Nemaska Lithium stakeholders, the positive outcome of months of thorough review of alternatives and of discussions with several interested parties. Pallinghurst is a renowned financier with a unique vision and a deep knowledge of the lithium and battery material sector, making it a prime partner with whom we can embark on the next phase of our development. With Pallinghurst and Investissement Québec’s loyal support, we are solidifying the Corporation’s longevity and therefore, increasing the inherent value of the project for our stakeholders,”

Guy Bourassa, President and CEO of Nemaska Lithium

As a condition of the letter of intent, a termination fee has been set in place. Should Nemaska Lithium choose to back out of the letter of intent, a $12 million fee will be payable to The Pallinghurst Group. If it so wishes, Pallinghurst can instead elect to be issued warrants of Nemaska Lithium that amount to 19.99% of the common shares of Nemaska upon conversion. These warrants are to be issued at a price of $0.25, and have a lifespan of one year from the date of issuance.

Nemaska Lithium shareholders are expected to vote on the final definitive agreement no later than October 2019.

Nemaska Lithium is currently trading at $0.22 on the Toronto Stock Exchange.


Information for this briefing was found via Nemaska Lithium. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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